Euro-sterling parity forecast for next year

US investment bank Morgan Stanley has raised its exchange rate forecasts for the euro, Reuters reported this Friday.

One pound could be worth one euro next year.

US investment bank Morgan Stanley has raised its exchange rate forecasts for the euro, Reuters reported this Friday.

The Wall Street bank expects €1 to be worth £1 next year, compared to 91p at the moment. For example, this means 1kg of carcase beef worth €4 would cost a British buyer £4 instead of £3.63 this week, putting pressure on Ireland's agri-food exports to the UK.

The euro is also forecast to climb in value against the US dollar, hitting €1=$1.25. This would again hit the competitiveness of Irish exports in the US and other markets around the world where the dollar is the currency of reference.